It is the month of August, on the shores of the Black Sea . It is raining,
and the little town looks totally deserted. It is tough times, everybody is
in debt, and everybody lives on credit.

Suddenly, a rich tourist comes to town.
He enters the only hotel, lays a 100 Euro note on the reception counter,
and goes to inspect the rooms upstairs in order to pick one.
The hotel proprietor takes the 100 Euro note and runs to pay his debt to
the butcher.
The Butcher takes the 100 Euro note, and runs to pay his debt to the pig
grower.
The pig grower takes the 100 Euro note, and runs to pay his debt to the
supplier of his feed and fuel.
The supplier of feed and fuel takes the 100 Euro note and runs to pay his
debt to the town’s prostitute that in these hard times, gave her “services”
on credit.
The hooker runs to the hotel, and pays off her debt with the 100 Euro note
to the hotel proprietor to pay for the rooms that she rented when she
brought her clients there.
The hotel proprietor then lays the 100 Euro note back on the counter so
that the rich tourist will not suspect anything.
At that moment, the rich tourist comes down after inspecting the rooms,
and takes his 100 Euro note, after saying that he did not like any of the
rooms, and leaves town.
No one earned anything. However, the whole town is now without debt, and
looks to the future with a lot of optimism….
And that, ladies and gentlemen, is how the United States Government is doing
business today.

Post from: Oz Accounting | Australian Financial & Tax Blog

A Stimulus Story

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“Can you explain what family trusts are about and how/if they can benefit a small family (no kids)?”

There any many variables you will need to consider but I’ll give a general overview.

To make a family trust it costs around $1000, so if your your not going to save more than that, there’s really no point.

To be effect the income source needs to be over about $30,000 as long as only one person is making money. A vital factor is Personal services income or PSI which must be below 80% meaning that all the income has to come from more than 80% from one source.

A family trust is ideal for a service skill such as a plumber or lawyer as they serve many different clients and do not work for a company.

The benefits are that is the husband earns $50,000 and spouse earns 0 than they can split the income between the two.

EG. Person on $50,000 would pay $8850 in tax.
Where as two people on $25,000 each would pay $2,850 each or $5,700
Thus a saving of 8850 – 5700 -$1000 for the trust costs = $2150 saving per year.

If you did have kids, it can help the situation even more saving an each $400-$600 depending on your tax bracket.

If this sounds like you, see your tax agent to get more advice.

If anyone picks up that i have missed something above comment below or contact us.

Post from: Oz Accounting | Australian Financial & Tax Blog

Family Trusts & The Tax Advantages

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Chuck replied: “Well then just give me my money back”.

The farmer said: “I cant do that, I went and spent it already”.

Chuck said: “OK then, just bring me the dead donkey”.

The farmer asked: “what are you gonna do with him?

Chuck said: “I’m going to raffle him off”

The farmer replied: “you cant raffle off a dead donkey!”

Chuck replied: Sure I can. Just watch me… I just wont tell anybody he’s dead.”

A month later, the farmer met up with chuck and asked, “what happened with the dead donkey!”

Chuck said: “I raffled him off. I sold 500 tickets at $2 a piece and made a profit of $898.00”

The farmer asked: “did anyone complain.

Chuck said: “Just the guy who won. So I gave him his $2 back.

Now Chuck works for the Government.

Post from: Oz Accounting | Australian Financial & Tax Blog

The Dead Donkey | Joke #2

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“I was expecting it to be in my bank account Monday morning but no sign of it. Thursday morning it appeared in the mail from my accountant who relayed it on to me.” -  Rhys Evans

Can’t the ATO get anything right?

Post from: Oz Accounting | Australian Financial & Tax Blog

ATO Stuffing Up Bank Deposits, Sending Cheques Instead

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Being looking at some shares recently these ones look good.

ABP – current share price .34 current annual dividend yield 20%

SHL & NUF both have announced recently improved profits on previous years accounts with solid balance sheets both showing a steady positions.

All three are worth having a look into.

Let me know what shares you guys have found that’s worth a look.

Regards,

Kieran

*Please note make sure you do your own research into these companies as its your money not mine )

Post from: Oz Accounting | Australian Financial & Tax Blog

ASX Buying Tips For May 2009

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Post from: Oz Accounting | Australian Financial & Tax Blog

OzAccounting New Contributor – Kieran Powell

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Haters said, “Pape was a filthy dog, why would any man try and stop us getting money from the government. We want our $900!” The haters were quickly rounded up by police and questioned.

Unfortunately Pape did not show up for day 2 in court, and the judge ordered an end to the case and gave the all clear to start giving out $900 bonus payments again from tomorrow.

Please Note: This is a April Fools joke and did not actually happen. :)

Post from: Oz Accounting | Australian Financial & Tax Blog

Bryan Pape Gunned Down On His Way To Court

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If they paid their bill the way we pay our taxes, it would go something
like this:
The first four men (the poorest) would pay nothing
The fifth would pay $1
The sixth would pay $3
The seventh would pay $7
The eighth would pay $12
The ninth would pay $18
The tenth man (the richest) would pay $59

So, that’s what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the
arrangement, until one day, the owner threw them a curve.

"Since you are all such good customers," he said, "I’m going to reduce the
cost of your daily beer by $20." Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes. So the
first four men were unaffected. They would still drink for free. But what
about the other six men? The paying customers?

How could they divide the $20 windfall so that everyone would get his fair
share?

They realized that $20 divided by six is $3.33. But if they subtracted that
from everybody’s share, then the fifth man and the sixth man would each end
up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man’s bill
by roughly the same amount, and he proceeded to work out the amounts each
should pay:
And so the fifth man, like the first four, now paid nothing (100% savings)

The sixth now paid $2 instead of $3 (33% savings)
The seventh now pay $5 instead of $7 (28% savings)
The eighth now paid $9 instead of $12 (25% savings)
The ninth now paid $15 instead of $18 ( 20% savings)
The tenth now paid $49 instead of $59 (16% savings)

Each of the six was better off than before. And the first four continued to
drink for free.

But once outside the restaurant, the men began to compare their savings.

"I only got a dollar out of the $20", declared the sixth man. He pointed to
the tenth man,"but he got $10!"

"Yeah, that’s right", exclaimed the fifth man, "I only saved a Dollar, too.
It’s unfair that he got ten times more than I!"

"That’s true!!", shouted the seventh man, "Why should he get $10 back when
I got only two? The wealthy get all the breaks!"

"Wait a minute", yelled the first four men in unison, "We didn’t get
anything at all. The system exploits the poor!"

The nine men surrounded the tenth man and beat him up.

The next night the tenth man didn’t show up for drinks, so the nine sat
down and had beers without him. But when it came time to pay the bill, they
discovered something important: They didn’t have enough money between all
of them for even half of the bill!

And that, boys and girls, journalists and university professors, is how our
tax system works.

The people who pay the highest taxes get the most benefit from a tax
reduction.

Tax them too much; attack them for being wealthy, and they just may not
show up anymore. In fact, they might start drinking overseas where the
atmosphere is somewhat friendlier.

For those who understand, no explanation is needed. For those who do not
understand, no explanation is possible.

Post from: Oz Accounting | Australian Financial & Tax Blog

Our Tax System in Layman’s Terms | Joke #1

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To be eligable you must meet this criteria:

• You had a tax liability for 2007/08. (Tax Paid – Tax Refund must be greater than 0) For example. You earnt $9,000, paid $2000 tax and got a refund back of $1000. This means you had a tax liability of $1000 which means you are eligible.
• Lodge you 2007-08 income tax return before 30 June 2009 (unless special deferred date arranged by ATO)
• Your 2007-08 taxable income does not exceed $100,000
• you are an Australian resident for tax purposes for the 2007-08 financial year.

How much Will you Get?

• $900 bonus will be paid if you have a taxable income up to and including $80,000
• $600 bonus will be paid if you have a taxable income exceeding $80,000 but not exceeding $90,000
• $250 bonus will be paid if you have a taxable income exceeding $90,000 but not exceeding $100,000

When will I get it?

• The first round of payments will commence from April 2009. Those who have already had their returns assessed will be the first to receive their payments.

How Will I Get It?

• If you haven’t updated your bank details with the ATO, you will be issued with a cheque, otherwise it will be deposited into your account.
  

If you are still unsure, please use this calculator on the ATO’s Website.

For More Info Visit The ATO’s Media Release

Post from: Oz Accounting | Australian Financial & Tax Blog

How To Know If You Will Get The Australian Government’s Tax Bonus Payment April 2009

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